An overseas investor arrived wanting eight apartments. They bought three, and outperformed the plan they came with.
Three assets, 7.4% net yield, single management line
The brief
The client had capital allocated and a spreadsheet showing eight studio and one-bedroom units across four communities. On paper it produced an attractive gross yield.
The problem with the plan
Eight units across four buildings means four service charge regimes, four management relationships and eight tenancy renewals a year. Gross yield is not the number that reaches your account.
What we did instead
Three larger units in two buildings with strong owners' associations and predictable service charge history. Fewer, better, and managed under a single line.
Two years on
Net yield of 7.4 per cent with zero vacancy periods, and a capital position in buildings that have held value through a softening apartment market.